Fresnillo hikes divi after surge in revenues and profits

Fresnillo, the world's largest primary silver producer and second largest gold producer in Mexico, saw sales rise by more than a half in 2011, helped by a surge in metals prices and an increase in production.

Revenue in the 12 months ended December 31st increased by 55.6% from $1,409.6m to $2,192.7m. Adjusted revenue, which excludes treatment and refining charges, increased by 56.6% to $2,307.4m.

The average realised silver price jumped by 62.5% during the year, while gold prices improved by 26.6%. Gold accounted for 43.7% of group revenues, up from 36.1% in 2008.

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Pre-tax profit jumped by 50.1% from $1,022.4m to $1,534.4m.

Following two dividends paid out earlier in the year - after rising metals prices and solid operating performance generated additional cash flow - the total dividend stands at 102.85 cents per share, significantly higher than the 44.8 cents per share paid out the year before.

The group says it remains in a good position, with $684.9m in cash and no debt on the balance sheet as of December 31st. "Our capital funding options remain flexible for exploration and development, pursuing potential acquisitions and returning dividends to shareholders," the statement said.

BC